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Moody's Downgrades Atlantic Power (AT)

Atlantic Power (AT) falls as Moody's downgraded the company's ratings, including the Corporate Family Rating to B2 from B1. Moody's also lowered the Probability of Default Rating to B2-PD from B1-PD and changed Senior Unsecured Notes to B3 from B2.

NEW YORK (TheStreet) -- Atlantic Power (AT) hit a one-year low of $2.22 on Monday as Moody's downgraded the company's ratings, including the Corporate Family Rating to B2 from B1.

The stock closed at $2.42, down 8.49% or 23 cents from its previous close of $2.65. It had a volume of 5.5 million, nearly four times its average of 1.38 million. The stock hit a high of $2.72 for the day and has a one-year high of $12.29.

Moody's also lowered the Probability of Default Rating to B2-PD from B1-PD and changed Senior Unsecured Notes to B3 from B2.

"The downgrade is driven by the increased debt load stemming from the new $600 million term loan at APLP," the Moody's report states. "We now expect CFO pre-W/C to debt at AT toward the lower end of the previously stated range of 4-7% over the next twelve to eighteen months. The term loan contains a 50% cash sweep on projects under APLP, constraining upstream distributions to the parent who continues to pay a sizable dividend to shareholders."

TheStreet Ratings team rates ATLANTIC POWER CORP as a "sell" with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

"We rate ATLANTIC POWER CORP (AT) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, generally high debt management risk and generally disappointing historical performance in the stock itself."